ANALYSIS: BAA steps up aviation revival drive - News that BAA is to reinstate its top comms position after an 18-month hiatus flags up the many challenges facing the recovering aviation sector, says Andy Allen

April 26, 2002
by ANDY ALLEN

If the British Airports Authority had decided to go about filling
its resurrected PR and corporate affairs director post six months ago,
it is reasonable to assume applicants would have taken a deep breath
before applying.

11 September and foot-and-mouth disease had decimated Britain's tourist
industry. British Airways cut 7,000 jobs (ten per cent of the workforce)
while Virgin Atlantic, which had never made staff redundant, shed 1,200
in response to slumping demand.

Now, the picture is brighter. Passenger figures for March were 3.4 per
cent higher than a year earlier. In the second consecutive increase,
Stansted, Edinburgh and Glasgow did particularly well. Heathrow rose
slightly while Gatwick fell. BAA this week announced £8bn of
investment to accomodate the expected surge in numbers over the next
decade.

No longer are aviation PROs hamstrung, as in the aftermath of 11
September, by considerations of discretion. Ad and PR campaigns shelved
in the interests of taste are now being safely carried out. The
Government go-ahead for Heathrow's Terminal 5 last November was another
boost.

Also it looks as if the current Civil Aviation Authority review of
airport fees will allow BAA to increase its charges by as much as 30 per
cent - still below main European fees, which can be up to double those
in the UK.

There remain, however, storm clouds on the horizon for Britain's largest
airport operator, and its new corporate and PA director - currently
being recruited (PRWeek, 19 April). The post has lain vacant since CSR
guru and former Liberal Democrats comms chief Des Wilson held the brief
up until early last year.

According to Philip Butterworth-Hayes, Jane's Airport Review founding
editor, the biggest threat to the reputation of British hubs lurks
offshore in the shape of Frankfurt, Amsterdam Schipol and, most
seriously, Paris's Charles de Gaulle airport.

The main PR challenge facing BAA, he claims, is to entice passengers
back to their airports as quickly as possible. Heathrow is particularly
important as it acts as a hub for incoming longhaul flights to link up
with European destinations. It is now by far Europe's biggest airport,
but others are gaining ground.

And while the Government's Terminal 5 decision came as a blessing,
Butterworth-Hayes says that what the airport really needs is more
runways. BAA had to lobby and campaign hard for 15 years to secure
permission for a new terminal on waste ground between two existing
runways.

BAA head of media relations Caroline Corfield describes this lag as, in
PR terms 'challenging,' and agrees that BAA regards the large foreign
competitors as its fiercest rivals (though she insists that promoting
efforts towards sustainability is the biggest PR challenge facing
BAA).

Corfield is anxious to focus on inevitable local campaigns that will be
brought to bear on any plans for airport expansions. BAA maintains
community affairs staff at all of its airports, but it is small wonder
that with so much hanging on government approval, a BAA source told PR
Week that 'political connections' would be a requirement for the
reinstated role.

Nor is it surprising, given how passenger numbers are expected to double
in the next 20 years, that CEO Mike Hodgkinson describes his task as
giving passengers the 'best experience, under the circumstances'.

These circumstances will become more trying with time for other reasons,
too. Butterworth-Hayes believes the only way the major airlines can
respond to falling margins is to set up low-cost variants - as bmi
british midland has just done with bmibaby.

The message being put out by BAA is that so far the low-cost phenomenon
has been 'a big plus' for the company - with Stansted, Edinburgh and
Glasgow, and more recently, Gatwick, all benefiting from the presence of
low-cost carriers. But that is precarious.

Even major airlines are nervous about fee increases, which will hit
low-cost airlines comparatively hard. In March, BA and Virgin Atlantic
made clear to journalists their fury at the proposed increase in charges
- closely linked to a decision by the CAA not to force BAA to subsidise
landing charges with retail profits. In the year to March 2001, net UK
airport retail income was £470m. The airlines branded the CAA's
plans 'absurd' and claimed they would inevitably lead to higher fares.
easyJet, long known for aggressive PR aimed at bigger carriers,
agrees.

The airline uses all three Scottish BAA airports but in England operates
at Luton and Liverpool - non-BAA airports. PRO Samantha Day says its
team is campaigning on the claim that such a price hike would be
'disastrous' and would force easyJet to reconsider its use of BAA sites:
'We're low-cost - there's only so much that can be passed on to the
passenger,' she says.

A further PR battle looming for BAA is outlined by Butterworth-Hayes,
who says the new comms chief will have to tackle BAA's growing
reputation for 'airports that are more interested in filling shopping
malls than processing passengers efficiently'

Corfield denies this is the case and says that since the EU abolished
duty free sales the issue has not arisen in media coverage.

Given the PR muscle available to the airlines, which will be stung by
BAA not using retail profits to subsidise airport fees, journalists may
well find their attention drawn increasingly to these profits.